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AM Best Revises Issuer Credit Rating Outlook to Negative for Bupa Insurance Company; Affirms Credit Ratings

September 17, 2021 GMT

OLDWICK, N.J.--(BUSINESS WIRE)--Sep 17, 2021--

AM Best has revised the outlook to negative from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term ICR of “bbb+” (Good) of Bupa Insurance Company (BIC) (Palmetto Bay, Florida). The outlook of the FSR is stable.

The Credit Ratings (ratings) reflect BIC’s balance sheet strength, which AM Best assesses as strongest, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management.

The revision of the Long-Term ICR outlook reflects the expected termination of the quota share reinsurance agreement BIC held with its wholly owned subsidiary, BUPA México, Compañía de Seguros, S.A. de C.V. (Bupa Mexico), and its relative impact on BIC. As a result of the termination of the treaty, BIC contributed capital to support the business being recaptured by Bupa Mexico. The negative Long-Term ICR outlook reflects AM Best’s concern regarding the future strategy and relationship between BIC, Bupa Mexico and the ultimate parent, British United Provident Association. Furthermore, AM Best has concerns that a change in business composition at BIC and uncertainties of future capital needs at Bupa Mexico could pressure the balance sheet strength assessment at BIC.


BIC’s balance sheet strength assessment remains at the strongest level. BIC also has the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). The company has a conservative investment portfolio, comprised mostly of fixed-income securities and cash and short-term deposits. Capitalization improved in 2020 driven by stronger earnings as a result of medical care being deferred during the COVID-19 pandemic. However, BIC’s earnings have historically been volatile and inconsistent.

BIC products focus on the international private medical insurance market and are concentrated in Latin America. The company’s business model has continued to change and has negatively impacted its membership and growth. The company’s reliance on Latin America for the majority of its business exposes it to geographic concentration, as well as pressures from economic conditions and regulatory environment.


This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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CONTACT: Antonietta Iachetta

Senior Financial Analyst

+1 908 439 2200, ext. 5792

antonietta.iachetta@ambest.comChristopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.comSally Rosen

Senior Director

+1 908 439 2200, ext. 5280

sally.rosen@ambest.comJim Peavy

Director, Communications

+1 908 439 2200, ext. 5644




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PUB: 09/17/2021 01:54 PM/DISC: 09/17/2021 01:54 PM